Warner Music Working With Impala, Merlin to Sell Parlophone Assets to Indies

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(from billboard.biz, February 19, 2013) In hopes of accelerating the purchase of Parlophone Label Group past European regulators and unifying major labels with the independent sector, Warner Music Group has announced the sale of some assets to independent labels. The assets available for purchase by the independent sector include Parlophone assets-or their equivalent in WMG-owned assets, and may include possible licensing and distribution deals.

“Having not blocked the sale of EMI, the result we have negotiated offers regulators the ‘best of both worlds’ in strengthening the independents by bringing more scale into the sector and by creating a more effective challenger to the Universal Sony duopoly,” IMPALA Executive Chair, Helen Smith, said in a statement, “Making sure our deal benefits labels of all sizes is a top priority and, by setting out the principles the parties agree are essential, we believe we have found a ‘blueprint’ for a market where independent artists should have a more level playing field. It is great to see Warner’s commitment to the independent sector reach fruition in this way.”

IMPALA first rejected the UMG deal to buy EMI recording music and protested the possible sale of Parolophone to Sony BMG, but two weeks ago began to praise WMG’s winning the $762 million bid for the record label formerly owned by EMI.

Merlin CEO, Charles Caldas, said negotiating a deal to sell Warner Parlophone was vital in order to prevent market consolidation to indies. “We had a duty to ensure our members had the best possible chance to continue to compete,” Caldas said, “this opportunity, to grow into what would otherwise be an unbridgeable gap between the largest majors and the rest of the market, should improve their ability to do so.”

Warner has agreed to lobby on behalf of independent labels to help achieve parity of access to digital service providers and other auxiliary businesses. These commitments of unity has led indie stakeholders to be optimistic that the agreement represents progressive, and believe the sale is a necessary step to counteract the effects of merging, and now see a bright future for the independent music industry.